More advisers hammered in busy week for ASIC
TheAustralian Securities and Investments Commission(ASIC) has continued with its crackdown on the financial planning industry, permanently outlawing two more people from acting as investment advisers or representatives of a dealer, and banning another for a period of two years.
The first permanent ban applies to Michelle Louise Eggmolesse, who was a former representative ofProfessional Investment Services(PIS).
An ASIC investigation found Eggmolesse had breached the Corporations Act by arranging for client funds to be paid into her personal bank account, which were later paid into an account held with a fund manager, established in Eggmolesse’s own name.
The funds were subsequently redeemed by Eggmolesse for her own benefit, without the client’s consent.
PIS brought the matter to ASIC’s attention in May 2002 and has since repaid the money to the client.
Stefan Capo, an authorised representative of Wilson HTM, was also banned permanently following ASIC’s finding that he had a personal interest in 16 securities purchases totalling $174,575 on three client accounts and did not disclose his interest to Wilson HTM.
The ASIC investigation found Capo continued to conduct unauthorised trading after a caution from Wilson HTM, and made false entries in his records about receiving instructions from clients in order to conceal the unauthorised trading.
The two-year ban was handed out to John Charles Whitehead, of Applecross in Western Australia.
ASIC says he had not performed his duties as an authorised representative honestly, efficiently and fairly, and as a result of his conduct, may not do so in the future.
Whitehead was an authorised representative and director of Winthrop Securities from November 1989 until September 2001.
In other enforcement action last week, a Melbourne man was sentenced to 12 months imprisonment after pleading guilty to seven charges brought by ASIC of fraudulently inducing the redemption of superannuation benefits, four charges of theft and one charge of false accounting.
Steven Terence Nightingall, who was previously involved with Aussie Insolvency Consultants, was convicted of assisting seven clients to withdraw their preserved superannuation benefits in breach of the law, and of stealing money from four of these clients.
Nightingall’s sentence was wholly suspended on the condition that he be of good behaviour for five years. He was also ordered to pay compensation of more than $15,000 to four former clients from whom he stole money.
Also last week, ASIC, in conjunction with the Australian Taxation Office (ATO), obtained orders in the Federal Court in Brisbane against a company, Creditsource, and its director Arkady Sittczenko, for operating a superannuation rollover scheme.
The scheme specialised in accessing the preserved component of members’ superannuation benefits before retirement.
In the past two years, ASIC has jailed 10 financial advisers and permanently banned another 62 from the industry.
Recommended for you
ASIC commissioner Alan Kirkland has detailed the regulator’s intentions to conduct surveillance on licensees and advisers who are recommending managed accounts, noting a review is “warranted and timely” given the sector’s growth.
AMP and HUB24 have shared the areas where they are seeking future adviser growth, with HUB24 targeting adding more than 2,000 advisers to the platform.
Bravura Solutions has appointed a new chair and deputy chair to take over from departing Matthew Quinn, while Shezad Okhai picks up another responsibility.
Two advisers say M&A is becoming a “contact sport” as competition heats up to acquire attractive advice firms, while a lack of new entrants creates roadblocks in organic growth opportunities.
